I need to contribute $5500 to my wife's tIRA and do a backdoor to Roth for 2017. My concern is I wont get the forms in time before doing my taxes in a few weeks or just otherwise complicate my return by doing this later than usual. Other than missing out on the next month of returns on $5500, should I make the $5500 contribution now for 2017 to the tIRA, let it sit for a month uninvested and then deposit another $5500 for 2018 on 4/16 and convert the $11k to a Roth and deal with the conversion on next year's tax return? Thanks guys!

Not 100% certain but I think the conversation will go on your 2018 return no matter what since that's the year the conversation took place. You can also make your 2018 contribution today if you wanted - you don't have to wait till after 4/15. So you could put in $11,000 today. $5500 for 2017 and $5500 for 2018. You could then convert it all to Roth which would all go on your 2018 return.

You can still make a nondeducible tIRA contribution for 2017. And you can currently make a 2018 contribution as well. But the conversion to Roth will be in 2018 no matter what at this point (assuming you make it).

The conversion is reported in the year that you do it without the extension until April that the contribution has.

No need to wait is what I'm saying.

Last edited by MP123 on Mon Mar 12, 2018 10:03 pm, edited 1 time in total.

If you are concerned about forms, you can amend/extend your tax return. I'm not sure what forms you're concerned about (1099-R, I presume), but I think those will probably get back to you within a month (at least that's how long it takes from the end of the year). You could call your broker for more information.

Other than missing out on the next month of returns on $5500, should I make the $5500 contribution now for 2017 to the tIRA, let it sit for a month uninvested and then deposit another $5500 for 2018 on 4/16 and convert the $11k to a Roth and deal with the conversion on next year's tax return?

You can do it all now in just a few days. I would make a $5500 tIRA contribution for 2017 tomorrow and another $5500 for 2018 on the same day. The first $5500 contribution will be reported on your 2017 8606 form with your tax return this year, and the second $5500 contribution for 2018 will be reported on the 8606 next year when the 2018 form becomes available.

I'd give it a few days after the contributions to verify all the money got into the account, then convert everything in the tIRA including any tiny earnings to a Roth. The $11000 conversion gets documented next year in the 2018 8606.
JW

The non-deductible Traditional IRA contribution and the conversion to Roth IRA are two separate steps. They are reported on the same form, because the numbers can interact.

The non-deductible IRA contribution is reported on the Form 8606 for the year that the contribution is for, since you have until tax day of the following year to make a contribution for a given year.

The Roth conversion is reported on the Form 8606 for the calendar year the conversion occurs in.

Make your 2017 IRA contribution. If you also have the money now to make the 2018 contribution, do that and then convert all of it. If not, then just convert the 2017 contribution, and when you make the 2018 contribution, convert it separately.

thanks guys. it appears i was mistaken in thinking that if i did a conversion in 2018 prior to 4/15/2018 that id need to account for it on my 2017 tax return. i typically do this before 12/31 each year but didnt this year for her account.

I may be misunderstanding it but
"The distribution from the IRA would have to be done by December 31 of the tax year. Then, if the distribution is completed on December 31, the transfer to the Roth could be done within 60 days after the end of the year."

So as long as the tIRA withdrawal is made in 2017, the actual contribution to Roth IRA needs to take place after 60 days.

That means that if you do a rollover to the Roth, then as long as you started it in the year it still counts as a conversion for the previous year. But that's only for "pending rollovers". There's no 60 days to start the process.

This week's fortune cookie: "Your financial life will be secure and beneficial." So I got that going for me, which is nice.